Diagnosing the Workforce

September 27, 2007
For several years, Intel Corp. asked employees to fill out a health risk assessment so the company could better tailor its health programs to specific conditions among employees.

Then in October, the Santa Clara, California-based computer chip maker decided it wanted a more objective picture of its employees’ health. The company offered free checkups at its on-site health clinics, with a third party collecting and analyzing the data.

"That’s when we realized we didn’t have an accurate picture of their health," says Patti Clavier, who works in Intel’s health and well-being operations and strategy group.

The difference between employee health reported by employees themselves and their actual health, as assessed by an objective source, was striking. Fifty-nine percent of employees had high blood pressure, according to the outside analysis, compared with 36 percent in the self-reported data. The percentage of employees with high cholesterol levels was 27 percent, compared with just 8 percent when employees reported the information.

The discrepancies show how objective data can change an employer’s picture of employees’ health. Inaccurate data can mean the difference between detecting and treating a chronic illness or letting it slide until a person’s health deteriorates and health care costs balloon. For employers looking to manage the costs of chronic illness and identify employees who may be unhealthy, reliable data is indispensable, health care experts say.

"It’s not simply, ‘Hey, fill this [health risk assessment] out,’ " says Chris Ryan, chief strategy officer for care management company SHPS in Louisville, Kentucky. "If you can’t measure the clinical risk of a population, you can’t manage the long-term cost trends of a population."

Once thought of as feel-good programs, wellness and disease management plans have grown up. Though health care cost inflation has moderated in the past 12 months, gone are the days when Weight Watchers meetings qualified as a company’s wellness plan. Based on the premise that treating a healthy workforce is less expensive than tending to a sick one, care management programs are becoming a key strategy for containing health care costs.

Employers believe that by using detailed data they can get an accurate picture of their workers’ health and can then develop a highly personalized approach to disease management tailored to the specific needs of both companies and individuals.

But measuring a return on investment remains more an art than a science. Funding a care management program, which can cost anywhere from 50 cents to $3 per person per month, depending on the intensity and scale of services provided, is one more factor in a long list of health care costs. Often, total costs increase as employees who once slipped through the cracks find themselves taking more medicine and visiting the doctor more frequently. The idea that healthy employees are more productive and help create a healthy work environment is widely accepted but difficult to measure. Employers who embrace these methods say that objective, accurate data allows them to spend health care dollars more efficiently because they can use it to develop a pinpointed approach to benefits.

"Data-driven analytics help get companies focused," says Raymond Fabius, president and chief medical officer of I-trax, a Philadelphia area-based health management company that operates on-site health clinics under its subsidiary CHD Meridian Healthcare.

The result is a customized benefits plan that can introduce cost-sharing based not on economic needs but medical ones. The difference is a clinically focused approach to managing employees’ health.

"The key is to be able to dial up and dial down intervention commensurate with risks, and without health analytics you can’t do that," Ryan says.

How data informs benefit decisions
Accurate data presents opportunities for care management companies to improve a person’s health by identifying gaps in that person’s care. Those gaps take on many forms. They occur when a patient does not get the right medicine; when a person’s health risks are not identified; when a person does not understand why he or she needs to take certain medications; or when a patient is on the right drug but suffers from side effects that make the drug inappropriate.

The value of a care management company lies in its ability to bridge the gaps in a patient’s care, says Michael Cousins, vice president of medical management consulting at Ingenix, a health data analysis company.

"Wellness programs are terrific because they bring awareness to the members, and that is a great first step," Cousins says. "But in order for there to be improvement in a patient’s health, what we’re seeing is greater integration."

Gaps in care are a symptom of America’s fragmented health care system, experts say. The system’s parts—patients, labs, doctors, hospitals, pharmacies—often are out of sync with one another.

In Intel’s case, the incomplete information the company had when employees self-reported their biometric data through health risk assessments was not just a matter of people’s tendency to soften the rough edges of their own bad health. In some cases, labs and doctors may have the information but don’t share it with the patient. A hospital may have taken key biometric measures but shared the information only with the patient’s primary care doctor.

When employers fund health management programs, they are paying to close those gaps, which they can’t identify until they have accurate information about their employees’ health.

Eventually, the data can lead employers down different paths as they determine the best course of action based on the health risks of their employees, the company’s health care budget, employee demographics and the kind of work employees do.

Some companies will choose on-site clinics if they have 1,000 or more employees at a single location. On-site doctors can steer employees into appropriate company-sponsored health programs.

A number of health insurance plans are piloting programs that coordinate care. For example, when a lab test is conducted, the information goes to the patient, the doctor and a health coach. Or, if a doctor writes a prescription, a nurse acting as an employee health coach would know about it and ask the patient if the prescription has been filled. Companies can also design co-pays and other financial structures based on the health profile of their employee population.

Marriott Corp. is perhaps the best example of a company that uses health data to design its pharmacy benefits in a way that targets individual benefits based on the employee’s health needs.

Since 2005, the hotel chain has structured pharmacy co-pays based on the health needs of individual employees. This personalized approach, called "value-based insurance design," is intended to reduce the financial barriers for those who under-utilize necessary medicine—itself a gap in care.

The company hired ActiveHealth Management, a subsidiary of Aetna, to develop rules that determine who is eligible for a reduction in co-pays.

"Our goal is to get our associates the essential care they need," says Jill Berger, vice president for Marriott’s health and welfare plan.

Once accurate data is obtained, employers can use it to design benefits that are "cost-neutral right out of the box," ActiveHealth CEO Lonny Reisman says. Employers do this by increasing the consumer cost of drugs that are not essential—such as toenail antifungal medicines—to offset giveaways and low co-pays on drugs that are shown by the data to be essential for certain employees.

"You can go to your CFO and say, ‘This is budget-neutral out of the box,’ " Reisman says. "There are ways to design this to make it more appealing to employers."

Reducing prescription co-pays has proved much easier than cutting fees to visit the doctor, since pharmacy claims are automated, whereas doctor’s office billings procedures are not.

Marriott recently introduced personal health records for employees, who then can choose to share the information with their doctor. As a result of its efforts, Berger says, Marriott’s health care cost increases have been in the single digits the past two years.

"And I think a lot of it has to do with the programs in place," she says.

Savings hard to quantify
    While Berger has been able to show cost trends that are in line with or slightly below the national average, justifying the cost of wellness programs has never been easy.

"The question of whether these programs save money is a hornet’s nest," Cousins says. "It depends on who you are asking."

In a recent SHPS study, the company found that employers using a clinically focused care management program lowered overall health care costs by 18 percent. Though the study noted it could not prove a direct causality between such a program and lower costs, a correlation nevertheless existed.

"The companies managing their health care costs the best are making targeted investments in better health for their population in order to avoid the extraordinary expense of acute and chronic care," Ryan says.

That seems logical enough. What has changed in recent years is that employers have become more willing to invest in health management efforts, even if the return on investment is not precisely quantifiable, says Thomas Ferraro, director of strategic relations with Mayo Clinic Health Solutions.

"The first question I would get from consultants representing companies used to be, ‘Can you give me an ROI?’ " Ferraro says. "They’ve come to recognize that I can’t tell you that a person lost weight based on my online program, because there may be many reasons. Now they’re not trying to measure any one component, but the effect of the whole program."

Others describe a shift in the way these efforts are valued. Rather than measuring the cost of health care, some consultants factor in the cost of lost productivity that they say might result if a company did not use one of these programs. Employers use a number of tools to measure this lost-productivity cost, including the Health Limitations Questionnaire and the Work Limitations Questionnaire. Both have been tested for validity and reliability, according to a 2004 report in the Journal of the American College of Occupational and Environmental Medicine, which looked at a number of productivity measures. For some executives, the cost in productivity lost because of bad health is more than zero, and therefore an investment in improving employee health is reasonable.

One benchmark that companies use for their efforts is identifying employees who have a chronic illness that would have gone undiagnosed were it not for a health management program.

Such data came in handy for Intel, Clavier says.

One young male employee at Intel said in a testimonial that his health check was "not what I expected." He was overweight and had high blood pressure. He talked to a health coach, and within six weeks lost 20 pounds.

Another Intel employee said she received a clean bill of health from her primary care doctor. But that doctor either didn’t order blood tests or ordered a blood test but did not check for blood sugar levels, a common indicator for diabetes. After having blood drawn at the on-site health clinic, she learned that her blood sugar levels revealed the early stages of diabetes.

Acquiring accurate data was the first step in identifying gaps in a person’s care. Closing those gaps, as identified by an accurate analysis of a population’s health, has benefited Intel employees, Clavier says. It has also proved to be a useful tool in gauging the company’s ongoing health management efforts.

"The missing data was certainly a compelling story to our CEO," Clavier says. "It told us we didn’t know the true costs."

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